Erica Orden writes:  The search to replace New York’s former top financial regulator,Benjamin Lawsky, has attracted the involvement of one of the banking industry’s harshest critics: U.S. Senator Elizabeth Warren (D., Mass.).

In recent weeks, Ms. Warren has placed calls to top staffers for New York Gov. Andrew Cuomo and others assigned to identify a successor to Mr. Lawsky, according to a person with direct knowledge of the search process. Ms. Warren’s advice: Tap Rohit Chopra, the student loan ombudsman and assistant director of the Consumer Financial Protection Bureau, which she helped start up and initially ran.

On Wednesday, the CFPB said Mr. Chopra would be leaving the bureau next week. Neither the bureau, nor Mr. Chopra, in a letter to the Treasury secretary, said what he planned to do next.

A spokeswoman for Ms. Warren didn’t comment on whether the senator has placed calls to the Cuomo administration or others on Mr. Chopra’s behalf, but pointed to a Facebook post from June 1 in which Ms. Warren endorsed the notion of Mr. Chopra succeeding Mr. Lawsky.

“He is smart as a whip, independent, hard-working, and loaded with integrity,” Ms. Warren wrote. “The New York banking superintendent is an important overseer of Wall Street, and I think Rohit would be phenomenal in that role.”

Charles Gasparino writes:  The problem isn’t Dimon’s mansplaining. It’s that Warren is telling a truth no one else will tell: Big banks aren’t free-market at all.

Warren says these big bank institutions should be broken up by the government out of fear that the system could implode as it did in 2008.

Dimon says the good senator should stick to making sure the Community Redevelopment Act is enforced and other pet lefty projects because she doesn’t “fully [understand] the global banking system.”

For once we have a leader in Washington, namely Warren, telling us what most of the political class and the bankers won’t: The banks are not free-market at all. They are big, government-protected entities that will be bailed out the next time a 2008 scenario comes around.

And the best way to make sure they don’t end up costing the taxpayers more money will be to make them smaller, which is about as close to a free-market statement as you might find on this subject, courtesy of Sen. Warren.

The dirty secret in Washington and Wall Street that Warren is exposing is that banks like JP Morgan, Citi, and B of A will always be on the government’s protected-species list because of a little thing known as deposit insurance, which covers bank deposits up to $250,000.

These banks just don’t take in deposits and lend them out so people can buy homes and so on anymore. Thanks in large part to Hillary Clinton’s husband, banks combine these commercial banking activities with Wall Street risk-taking.

Meanwhile, JP Morgan has a whopping $1.4 trillion in deposits. A massive screwup on its trading desk or some 2008-like event that leads to insolvency could mean the taxpayer is on the hook for a chunk of that money—a number, I might add, that could dwarf the $800 billion stimulus package President Obama  blew through during the Great Recession.

What free-marketer would allow the American taxpayer to subsidize Jamie Dimon’s risk-taking?

Again, the Dodd-Frank Act was supposed to get rid of Too Big to Fail, but the reality that Warren is at least honest about is that it hasn’t:

What’s great about the Warren vs. Dimon feud is that it both exposes Wall Street’s real crony capitalism roots and the hypocrisy of Hillary Clinton remaking herself in the Elizabeth Warren class-warrior mode. Yes it was Bill Clinton who enacted one of the least thought-out banking laws back in 1999 that made it legal to combine commercial-banking activities with Wall Street-style risk-taking.

The result of what was known as the Gramm-Leach-Bliley Financial Services Modernization Act was the permanent dismantling of the Glass-Steagall Act, which made it illegal to mix bond trading with deposit-taking.

The law paved the way for the creation of the financial supermarket known as Citigroup, which would go on to hire Clinton Treasury Secretary Robert Rubin as one of its top executives and board members. Hillary Clinton has collected hundreds of thousands of dollars in speaking fees from bankers.

She won’t of course, but Warren should be given credit for explaining just how protected and coddled banks still are in many ways, thanks to the Clintons and their unholy alliance with Wall Street. Dimon’s comments about Warren are shocking only because they were made honestly and publicly.

Why should taxpayers subsidize his paycheck, which goes up with every successful trade? My advice: If Jamie Dimon wants to roll the dice in the derivatives markets, he should first be forced to give up his access to FDIC insurance on JP Morgan’s deposits.

I’m pretty sure Adam Smith and Elizabeth Warren would agree.

HSBC began in Hong Kong during the colonial period.  Pummelled by regulators in the UK where its headquarters are now located and looking at drramatic rises in GNP in Asia, HSBC is contemplating a move back to its roots in Hong Kong.

Deutsche Some and  other big banks having probelm in thier home countries are looking to retrench.  Few have HSBC’s history.

With the exception of CItibank in the US, most of the big banks weathered the most recent financial crisis well.  Part of this came from their presence across the globe.

Where bigs will operate and how big they will be are questions on the table now.

New York Federal Reserve comments   The Federal Reserve is responsible for the prudential supervision of bank holding companies (BHCs) on a consolidated basis, as well as of certain other financial institutions operating in the United States. Prudential supervision involves monitoring and oversight of these firms to assess whether they are in compliance with law and regulation and whether they are engaged in unsafe or unsound practices, as well as ensuring that firms are taking corrective actions to address such practices

Prudential supervision is inter-linked with, but distinct from, regulation of these firms, which involves the development and promulgation of the rules under which BHCs and other regulated financial intermediaries operate. The distinction between supervision and regulation is sometimes blurred in the discussion by academics, researchers and analysts who write about the banking industry, and the terms “supervision” and “regulation” are often used somewhat interchangeably. Moreover, while prudential supervision is a central responsibility of the Federal Reserve and consequently accounts for substantial resources, the responsibilities, powers and day-to-day activities of Federal Reserve supervision staff are often not very transparent to those outside of the supervision areas of the Federeal Reserve System.

The primary focus of this discussion is on the supervision of large, complex bank holding companies and of the largest foreign banking organizations (FBOs) and non-bank financial companies designated by the Financial Stability Oversight Council (FSOC) for supervision by the Federal Reserve. The paper focuses on oversight of these firms because they are the most systemically important banking and financial companies and thus prudential supervision of them is especially consequential. Given their size and complexity, the approach to supervision of these companies also differs from that taken for smaller and less complex firms. It is important to note that supervision of these large, complex firms is conducted through a comprehensive System-wide program governing supervisory policies, activities and outcomes.The discussion in this paper focuses solely on supervisory staff located at the Federal Reserve Bank of New York, whose activities are carried out as part of this broader program.  Supervising Too Big to Fail